Together with the strong three-day rally, SpaceX (NASDAQ: SPCX) stock short volume ratio rose and, by Tuesday, October 6, hit a new two-week high.
Specifically, the number climbed to 61.02 – slightly higher than Monday’s 58.98 and significantly higher than Friday’s 50.75 – indicating a rising belief that the SPCX equity uptrend cannot be sustained, per the data Finbold retrieved from Fintel on Wednesday, October 7.
Indeed, the short volume ratio measures the proportion of bullish to bearish bets on a stock, and the latest readings for SpaceX shares signal that a significant majority of trades were positioned for a downside.
SpaceX stock soars 15% in three days
Meanwhile, the two-week high of 61.02 came as the SPCX rally – started in earnest on October 2 – that, at its peak, took the equity nearly 18% began stagnating.
Not only has SpaceX stock risen only 0.49% on Tuesday, but it also fell substantially from the intraday highs and even went 1.15% into the red in the subsequent extended session.
Nonetheless, shorting SPCX shares could easily prove a losing wager since most of the catalysts that enabled the rise from the previous range below $150 to the latest closing price of $171.92 and the press time price of $169.94 remain in play.
Could a SPCX stock short squeeze be imminent?
As Finbold reported on October 6, the latest SpaceX stock launch appears driven by a variety of smaller, yet important positive developments.
Wall Street analysts have repeated their belief in the firm’s long-term prospects, while also ushering in a degree of urgency to buy ahead of the planned Starship Flight 15 – itself an important driver, as it will, if successful, prove the third consecutive milestone rocket launch.
Simultaneously, Elon Musk’s return to the Trump Administration as a co-leader of a cutting-edge Pentagon program also reinforced the trillionaire’s strained relationship with the commander-in-chief – a crucial development given how intertwined SpaceX is with the U.S. government.
Similarly, the fact that the world’s first trillionaire confirmed that his company would adopt President Donald Trump’s name change of artificial intelligence (AI) into ‘super intelligence’ (SI) served as another piece of the puzzle.
Lastly, and looking ahead, SpaceX’s hope to secure $40 billion in funds to purchase Nvidia (NASDAQ: NVDA) chips might provide the final ingredient to ensure a short-term short squeeze.
Featured image via Shutterstock
